France to take stake in Sanofi unit to quell backlash over sale to US firm

The French government is to take a stake in the pharmaceutical company Sanofi’s consumer healthcare division to try to quell a backlash as the US private equity firm Clayton, Dubilier & Rice enters talks to buy the unit for €16bn (£13.3bn).

Sanofi is spinning off Opella, which makes the paracetamol brand Doliprane, the laxative Dulcolax and other over-the-counter medicines. However, the revelation of talks with CD&R earlier this month prompted concerns over French jobs and the loss of control to a foreign company.

The companies pressed ahead with talks despite the controversy. Sanofi on Monday announced that it had entered exclusive talks with CD&R for the sale of a 50% stake, valuing the company at about €16bn. However, France’s state-owned investment bank, Bpifrance, will also take a 2% stake if the deal goes through.

The unusual move will give the French government a stronger say in the future direction of Opella, which employs 11,000 people worldwide and 1,700 in France. Paris-listed Sanofi also said that it would retain a stake in the division but was switching to focus on producing vaccines.

France’s economy minister, Antoine Armand, said in a post on the X social network on Sunday that the government had obtained “guarantees on the maintenance and development of Opella in France”.

He wrote: “Our requirements on employment, production and investment will be respected. For Doliprane and other essential medicines in the country.”

Workers had previously protested against the deal outside Opella factories. However, Sanofi had insisted that the sale would not have an impact on employment in France.

Doliprane is the bestselling drug in France but production in the country became a political hot topic during the coronavirus pandemic when shortages prompted the government under Emmanuel Macron to invest in production within the country.

From Sanofi’s point of view, the deal follows the logic of similar spin-offs by the American drug companies Johnson & Johnson and Pfizer and Britain’s GSK, who have sold their consumer businesses to concentrate on researching and developing new drugs.

Paul Hudson, Sanofi’s British chief executive, said: “Our chosen partner CD&R has demonstrated unique capabilities in the consumer space, with deep values of respect for employees, customers, communities in which they operate, and the environment. We also welcome Bpifrance as a supporter of Opella’s development journey.”